How Invoice Factoring Works
A simple, transparent process to accelerate your cash flow without taking on new debt.
Complete the Work and Invoice Your Customer
You deliver your goods or perform your services exactly as you normally would. Once the job is complete, you generate an invoice for your customer (B2B or B2G) with your standard net-30, net-60, or net-90 terms.
Sell the Invoice to a Factoring Company
Instead of waiting for your customer to pay, you submit the invoice to your factoring partner. They verify the invoice is valid and the work has been completed.
Get Funded within 24 Hours
The factoring company advances you the bulk of the invoice value—typically 80% to 90%—within 24 hours. This immediate injection of capital allows you to pay payroll, buy materials, and take on new jobs.
Your Customer Pays the Factor
Your customer remits payment directly to the factoring company according to the original invoice terms (e.g., after 30 days). Professional factoring companies handle these collections courteously.
Receive the Reserve Balance
Once the factoring company receives the full payment from your customer, they release the remaining 10% to 20% back to you (the "reserve"), minus their small factoring fee.